Texas Developer Draws Buyers with Education Fund
RENEE MONTAGNE, host:
A north Texas developer has come up with an innovative way to lure home buyers to Castle Hills, a subdivision near Dallas with over 1,000 homes. He gives money to local public or private schools attended by residents of his subdivision through a non-profit foundation. College students are also eligible for help. Bill Zeeble of member station KERA in Dallas reports.
BILL ZEEBLE reporting:
Castle Hills Elementary could be any school USA. Each weekday more than 700 kindergarten through fifth-graders fill this relatively new building, their art, history or social studies projects lining the hallway walls. But here's a difference.
Ms. MONA EFFLER(ph) (Teacher): We received over $126,000. It will be dispersed, part of it this spring and part of it this fall, for the educational benefit of the children.
ZEEBLE: Mona Effler teaches the school's gifted and talented students. Her room boasts an expensive DVD, video and Web-connected interactive screen. The school also has electric pianos and other high-tech tools unaffordable without money from the local, non-profit Castle Hills School Foundation. Developer Chris Bright came up with the idea.
Mr. CHRIS BRIGHT (Developer): Education is an important thing to people, and so we've created it in order to enhance the education that the residents of this community would be able to receive.
ZEEBLE: It's the funding mechanism that's unique. Homes sell for about 300,000 to more than a million dollars. For every property sold in the development, the foundation receives a half percent of the sales price. Those costs, says Bright, are passed on from the home builder to the buyer.
Mr. BRIGHT: When you're typically seeing closing costs on a single-family sale running about 7 percent anyway, I mean, an extra half a percent kind of gets buried in the overall type of deal.
ZEEBLE: Some Castle Hills home builders love the education fund. They use it as a marketing tool to attract buyers. But at least one, Brian Earley with Lewis & Earley Custom Homes, isn't entirely convinced. Speaking by cell phone from one of his job sites, he says the fund is not exactly free to residents.
Mr. BRIAN EARLEY (Lewis & Earley Custom Homes): If I've got a developer that's trying to tag me for an extra half percent, well, I've got to bill that into my cost, and whatever that cost is, he could tag me for 5 percent as far as I'm concerned, it doesn't matter. I mean, that's still going to be part of my cost, which in turn I'll figure my profit on top of that cost and the homeowner pays that price.
ZEEBLE: Earley says he has no problems with an additional education fund. Property taxes, of course, still pay for public education. But he thinks this foundation should target less-affluent families.
Mr. EARLEY: I've had customers that gripe and complain about it because they know the reality is that they're just giving money to families that really, again, relatively speaking, don't need it.
ZEEBLE: Castle Hills home owner John Lopez, for one, says he does need it. The fund gives full-time, passing college students $2,000 a year. Lopez has two kids already in college and one going soon.
Mr. JOHN LOPEZ (Castle Hills Resident): By the time we're all said and done between all three of my kids go through and go through college, it's going to be about $26,000. This is money that my kids can use. I mean, they've earned it.
ZEEBLE: Over the last four years the Castle Hills School Foundation has distributed more than a million dollars. The money's gone to 11 schools and college-attending residents, while other developers are looking at it. Next year the school's foundation will also help Castle Hills' teachers pay tuition for advance degrees. For NPR News, I'm Bill Zeeble in Dallas.
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